roundtable discussion with distinguished experts ... · mizue tsukushi president and ceo, the good...

Participants

Ryuta UozumiPresident and CEO, KPMG AZSA Sustainability Co., Ltd.

Gento MogiAssociate Professor, Department of Technology, Management for Innovation, School of Engineering, The University of Tokyo

Izumi WashitaniProfessor, Department of Ecosystem Studies, Graduate School of Agricultural and Life Sciences, The University of Tokyo

Kuniharu TakemataExecutive Director, Vice-Chairperson, Environmental Management Promotion Board, J-POWER

Yuko SakitaJournalist and environmental counselor

Mizue TsukushiPresident and CEO, The Good Bankers Co., Ltd.

“Sustainability” is a word we hear in relation to the

global environment, but to create a sustainable society,

we also need sustainable companies. Companies

possess core skills that can make a contribution to

society, and if they can provide technologies to the

world, they will be able to contribute to the creation of a

sustainable society. For example, because technologies

that increase the efficiency of energy use reduce costs

and also reduce CO2 considered on an emission

intensity*1 basis, I believe it to be best that we consider

the sustainability of the global environment at the

company level.

Looking towards 2030 and 2050, energy demand

will continue to increase in China and India, and it is

predicted that there will be a shift towards coal-fired

generation, with its excellent cost-performance, to

supply the necessary power. However, CO2 emissions

per unit of power generated are high for coal-fired

generation, and for this reason countries around the

world are engaged in the development of CO2

separation, capture, and underground storage (CCS)

technologies. Against this background, the J-POWER

Group’s high-efficiency coal-fired generation

technologies and CCS technologies are highly regarded

around the globe, and I feel that the provision of these

technologies to the world should form the basis of the

strategy with which you proceed. (I believe that whether

or not CCS goes into actual use will be determined by

the comparison between its cost and compliance costs).

With regard to the corporate targets for your

Environmental Management Vision, I think that they will

be further improved if you indicate goals and ultimate

targets. Given that the 10th meeting of the Conference

of the Parties to the Convention on Biological Diversity

(COP10) will be held in Nagoya in the fall of this year,

you might also consider setting targets in relation to

biological diversity.

Make a global contribution by providing new technologies for coal-fired generation


The reduction of CO2 emissions is tremendously

important as a measure against global warming. The

reduction of CO2 emissions in energy supply is a

particularly important area of focus, and for this reason I

believe that the J-POWER Group’s concept of

“Harmonizing energy supply with the environment”

represents an extremely valuable perspective.

Sustainability Report 2009 considered the “Safe,

Sustainable Use of Nuclear Energy.” I think it is highly

commendable that you stated honestly that you take

multiple safety measures into consideration in the case

of nuclear power stations, due to the fact that

“radioactive materials are being handled,” and that

“machines can fail.” I felt that it would have been even

better had you indicated the J-POWER Group’s thinking

on nuclear energy after you had discussed the balance

in your energy structure of sources that produce no CO2,

including renewable energy sources, and clarified your

future energy strategy in its entirety.

In a period of economic downturn like the present,

we tend to feel that it is difficult to invest in the

environment. However, it is precisely periods such as

this when such investment is necessary. This is a period

of change in which industry, consumers, and the

administration together can turn the economy around

with the environment as the axis. For this reason, I think

that coal-fired facilities should be replaced as much as

possible with high-efficiency facilities.

In addition, there is an increasingly active movement

in regional communities towards the idea of achieving

energy independence and revitalizing regional areas by

making intensive use of previously untapped resources.

The use of woody biomass and bamboo in particular

would bring Japan’s mountain regions back to life and

would play a part in revitalizing the nation’s industries,

beginning with agriculture and fisheries. I look forward

to proposals by the J-POWER Group that take into

consideration a variety of energy plans for regional

areas, including the use of sewage sludge.

Formulate energy plans suited to regions


Many data companies that collect information using

artificial intelligence, as well as those that screen

socially responsible investments (SRI), are presently

being acquired by Bloomberg*1 and Thomson Reuters*2.

This indicates that a company’s environment/society/

governance (ESG) performance is regarded as a main

factor in their assessment. In the future, companies will

need a strategic approach to ESG, from the perspective

of indicating exactly on what they place value.

For a long period, Japan’s environmental technologies

have been regarded as the best in the world, but recently

China and Korea are catching up to or even overtaking

us. Just considered from the perspective of population,

China has ten times the amount of people required to

surpass Japan’s level, and I believe that there is an

extremely strong possibility that the nation will make

breakthroughs in any number of fields in the future.

Considering this situation, I have been suggesting

that the J-POWER Group should market its expertise in

the operation of high-efficiency coal-fired power station

technologies in India and China. While manufacturers

may possess technologies, it is rather rare that they

leverage those technologies to provide services. In the

future, it will be important for the J-POWER Group,

holding a position as industry leader, to develop

high-efficiency coal-fired generation technologies, in

addition to fostering human resources able to sell those

technologies in the form of expertise, as well as human

resources capable of operating those technologies. It is

likely in future that the boundary between energy

companies and resources companies will disappear. It is

my belief that, having ensured that you are ahead of the

trends of your overseas competitors, emphasizing the

fact that you are a highly competitive company will

represent an advantage from the perspective of investor

relations (IR).

Make technology a service and foster personnel to sell that service


69

The J-POWER Group strives to incorporate various forms of third-party evaluations and recommendations into its activities, including reviews, Sustainability Report questionnaires, and expert opinions. By means of these evaluations and opinions, we determine the kind of business development and environmental activities that others expect of the J-POWER Group and work to improve our sustainable management. We also enhance our transparency and reliability by making such comments public.

At present, the J-POWER Group is working vigorously to achieve the corporate targets outlined in our Environmental Management Vision (p. 41-42). However,

fiscal 2010 represents the year of completion for the majority of these targets.

Given this, we gathered together experts from outside the company to discuss the type of targets that J-POWER should work towards from fiscal 2011

onwards. Our guests offered wide-ranging opinions and suggestions from a variety of specialized perspectives.

(The Roundtable was held on December 18, 2009)

External Evaluation and Outside Opinions

Roundtable Discussion with Distinguished ExpertsHarmonizing energy supply with the environment

—Environmental Management in the J-POWER Group from 2010 Onwards—

*1 Emission intensityCO2 emission intensity. CO2 emissions per unit of electricity sold.

Participants







“Sustainability” is a word we hear in relation to the

global environment, but to create a sustainable society,

we also need sustainable companies. Companies

possess core skills that can make a contribution to

society, and if they can provide technologies to the

world, they will be able to contribute to the creation of a

sustainable society. For example, because technologies

that increase the efficiency of energy use reduce costs

and also reduce CO2 considered on an emission

intensity*1 basis, I believe it to be best that we consider

the sustainability of the global environment at the

company level.

Looking towards 2030 and 2050, energy demand

will continue to increase in China and India, and it is

predicted that there will be a shift towards coal-fired

generation, with its excellent cost-performance, to

supply the necessary power. However, CO2 emissions

per unit of power generated are high for coal-fired

generation, and for this reason countries around the

world are engaged in the development of CO2

separation, capture, and underground storage (CCS)

technologies. Against this background, the J-POWER

Group’s high-efficiency coal-fired generation

technologies and CCS technologies are highly regarded

around the globe, and I feel that the provision of these

technologies to the world should form the basis of the

strategy with which you proceed. (I believe that whether

or not CCS goes into actual use will be determined by

the comparison between its cost and compliance costs).

With regard to the corporate targets for your

Environmental Management Vision, I think that they will

be further improved if you indicate goals and ultimate

targets. Given that the 10th meeting of the Conference

of the Parties to the Convention on Biological Diversity

(COP10) will be held in Nagoya in the fall of this year,

you might also consider setting targets in relation to

biological diversity.

Make a global contribution by providing new technologies for coal-fired generation


The reduction of CO2 emissions is tremendously

important as a measure against global warming. The

reduction of CO2 emissions in energy supply is a

particularly important area of focus, and for this reason I

believe that the J-POWER Group’s concept of

“Harmonizing energy supply with the environment”

represents an extremely valuable perspective.

Sustainability Report 2009 considered the “Safe,

Sustainable Use of Nuclear Energy.” I think it is highly

commendable that you stated honestly that you take

multiple safety measures into consideration in the case

of nuclear power stations, due to the fact that

“radioactive materials are being handled,” and that

“machines can fail.” I felt that it would have been even

better had you indicated the J-POWER Group’s thinking

on nuclear energy after you had discussed the balance

in your energy structure of sources that produce no CO2,

including renewable energy sources, and clarified your

future energy strategy in its entirety.

In a period of economic downturn like the present,

we tend to feel that it is difficult to invest in the

environment. However, it is precisely periods such as

this when such investment is necessary. This is a period

of change in which industry, consumers, and the

administration together can turn the economy around

with the environment as the axis. For this reason, I think

that coal-fired facilities should be replaced as much as

possible with high-efficiency facilities.

In addition, there is an increasingly active movement

in regional communities towards the idea of achieving

energy independence and revitalizing regional areas by

making intensive use of previously untapped resources.

The use of woody biomass and bamboo in particular

would bring Japan’s mountain regions back to life and

would play a part in revitalizing the nation’s industries,

beginning with agriculture and fisheries. I look forward

to proposals by the J-POWER Group that take into

consideration a variety of energy plans for regional

areas, including the use of sewage sludge.

Formulate energy plans suited to regions


Many data companies that collect information using

artificial intelligence, as well as those that screen

socially responsible investments (SRI), are presently

being acquired by Bloomberg*1 and Thomson Reuters*2.

This indicates that a company’s environment/society/

governance (ESG) performance is regarded as a main

factor in their assessment. In the future, companies will

need a strategic approach to ESG, from the perspective

of indicating exactly on what they place value.

For a long period, Japan’s environmental technologies

have been regarded as the best in the world, but recently

China and Korea are catching up to or even overtaking

us. Just considered from the perspective of population,

China has ten times the amount of people required to

surpass Japan’s level, and I believe that there is an

extremely strong possibility that the nation will make

breakthroughs in any number of fields in the future.

Considering this situation, I have been suggesting

that the J-POWER Group should market its expertise in

the operation of high-efficiency coal-fired power station

technologies in India and China. While manufacturers

may possess technologies, it is rather rare that they

leverage those technologies to provide services. In the

future, it will be important for the J-POWER Group,

holding a position as industry leader, to develop

high-efficiency coal-fired generation technologies, in

addition to fostering human resources able to sell those

technologies in the form of expertise, as well as human

resources capable of operating those technologies. It is

likely in future that the boundary between energy

companies and resources companies will disappear. It is

my belief that, having ensured that you are ahead of the

trends of your overseas competitors, emphasizing the

fact that you are a highly competitive company will

represent an advantage from the perspective of investor

relations (IR).

Make technology a service and foster personnel to sell that service


70*1 Bloomberg

A US company that offers comprehensive information services, providing economic and financial information and operating communications and broadcasting businesses.

*2 Thomson ReutersA major international information provider based in the US.

Because environmental problems are global problems, it

is important that we aim for the overall optimum rather

than focusing on achievement of the optimal in

individual companies. The use of coal to produce

electricity should be encouraged from the perspective of

efficient use of energy resources; saying that coal use is

bad for the environment is arguing from the wrong

direction. Converting coal into electricity and using it

effectively is an important mission for J-POWER, and the

use of technology to increase the efficiency of this

conversion is essential from the perspective of the

environment and the efficient use of fossil fuels.

Looking at carbon capture and storage (CCS), its

most rational use is for EOR*1 in oil fields, and I believe

that it is a technology that should be used in oil fields in

the Middle East and China. In the future, this technology

might be sold to China, or used to obtain credits via

CDM. CO2 emissions must be reduced on a global level

rather than by Japan alone, and you should by all means

make use of CDM, the most promising means of

realizing this.

With regard to nuclear power, I would first like you to

consider a sustainable system. If we use nuclear fuels in

a once-through cycle, then uranium is a vanishing

resource, and we have only enough for about 60 years.

It is therefore desirable that we consider how to realize

the nuclear fuel cycle*2 more rapidly.

Finally, it is in the nature of a company to seek

profits, but a company that places a burden on the

environment as a result of this profit-seeking cannot be

called a sustainable one. The desirable situation is one

in which the company naturally makes a contribution to

society via the environment as a result of pursuing

profits. I would like to see the J-POWER Group develop

mechanisms that make this possible.

Balance the pursuit of profit with contribution to society via the environment


I am extremely concerned by the fact that when a large

power station is built, the natural environment and

biological diversity may be sacrificed. Numerous plans

also exist for wind power development, and I think that it

will be important for us to conduct strategic

assessments at the planning stage with a clear focus on

the position of wind power in the Japanese environment.

Both in Japan and around the world, populations are

tending to concentrate in cities, and it will be essential

for us to understand how this affects demand for

electricity. Tokyo is a mega-metropolis, huge even by

world standards, but it is at the top of the class as far as

CO2 emissions are concerned. Tokyo’s population is ten

times that of San Diego in the US, but it emits less CO2.

It will be difficult to stop the further growth of cities in the

future, but I believe that by considering the best

direction for urban development, we will be able to

control CO2 emissions to a significantly lower level.

If the amount of human movement declines with the

future aging of the population, it is possible that the

volume of energy use will also decline. Precisely at

present, it is important that we attempt to develop ways

of living that are comfortable and yet do not produce a

burden in the form of CO2.

Excess generation capacity tends to be necessary

because of peaks in electricity demand. If we were able

to use electricity in such a way that no peaks occurred,

we could reduce the burden on the environment. The

Japanese Smart Grid design will be essential in realizing

this goal.

Develop power sources suited to the ways in which cities should be developed as well as to population trends


*1 EOREnhanced oil recovery. Methods of extracting the remaining oil reserves from fields on which wells have ceased to flow or in which the water content of the oil stratum has increased.

*2 Nuclear fuel cycleThe efficient reuse of uranium resources by separating, recovering, and reusing useful substances such as plutonium from spent fuel.

Response to the discussionsThe most important environmental management issues for the J-POWER Group are, first, measures against CO2, and, second, measures to deal with waste products, chiefly coal ash.

With regard to measures against CO2, we will contribute to a reduction in CO2 emissions on a global scale by transferring the world’s most advanced high-efficiency coal-fired generation technologies overseas. Looking at waste products, in future we will continue to make efforts to achieve efficient use, and we will work to maintain the present target level.

Giving consideration to the opinions of the participants in today’s roundtable, we will seek to increase awareness of energy, our region, and the environment within the J-POWER Group, and we will steadily implement each of the initiatives that we adopt.


71


19%

2% 0%

29%

50%

Very thorough andcomplete

Thorough and complete

Average

Inadequate

Very inadequate

● Design and layout of report

0 50 100 150 200 250 (Persons)

Special features

Corporate governance

Sustainable development inJapan and the world

Enhancing communication

Environmental management in the J-POWER Group

Efforts relating to global environment issues

Efforts relating to localenvironment issues

Ensuring transparencyand reliability

● Breakdown of survey respondents

● Items of particular interest (multiple answers)

● Quantity and Quality of Information in the Report

8%1% 0%

39%

52%

Very thorough andcomplete

Thorough and complete

Average

Inadequate

Very inadequate

People doing businesswith our company

1%

Investors60%

People in survey/research institutions

1%

Other3%

Employees involved in theircompany’s environmental

affairs and CSR2%

Ordinarycitizens33%

72

We received many comments from readers in response to the J-POWER Group Sustainability Report 2009 (published July 2009) (391 respondents). We

consider these valuable comments to be important guidelines for compiling subsequent reports and for the future initiatives of the J-POWER Group, and

intend to put their lessons to use in our corporate activities.

Readers’ Opinions

Other comments and our responses can be viewed on our website.

● Expectations for the J-POWER Group

http://www.jpower.co.jp (Japanese only)

Typical comments Our response

I hope that you will push ahead and finally succeed in the development of carbon capture and storage (CCS) technologies for coal use.If this technology goes into use, we will make significant progress on the problem of global warming.

CCS technologies are technologies for the separation and capture of CO2 from large-scale emission sources such as coal-fired power stations, and its stable storage deep underground. We consider them to be promising technologies in the fight against global warming, and we are pursuing a variety of related technological developments.[For further information, please see “Establishment of Osaki CoolGen Corporation” and “A Variety of Initiatives in the Area of Technologies related to CO2 Capture and Storage (CCS)” on page 54 in the Environmental section of this report.]

For the sake of the global environment, I would like to see progress in the use of woody biomass and waste products such as sewage sludge as fuel.

Seeking to reduce CO2 emissions, we are working to make effective use of biomass, for example by co-combusting biomass such as sewage sludge and logging remnants from Japanese forests in coal-fired power stations.[For further information, please see “Beneficial Use of Biomass” on pages 51-52 of the Environmental section of this report.]

Further responses to environmental problems seem to be necessary, and I am looking to J-POWER for sophisticated initiatives. I am also impressed by your company’s responses to the issue of biological diversity.

When the J-POWER Group constructs a new power station, we conduct an environmental assessment, and give appropriate consideration to the protection of the environment while reflecting the opinions of the residents of the region and others. In addition, we engage in careful monitoring while implementing environmental protection measures that will see our activities harmonize with nature.In going about our business activities, we take biological diversity into consideration, and we work to function in harmony with the natural environment.

I want to see J-POWER really working to put into action all the items covered by the Sustainability Report.

We will continue to conduct environmental management, based on our corporate philosophy – “to ensure constant supplies of energy to contribute to the sustainable development of Japan and the rest of the world” – and taking into consideration the opinions of all our stakeholders.

73


The Accuracy of This ReportTo ensure the accuracy and comprehensiveness of important

environmental and societal data as well as performance

indicators (hereinafter “sustainability information”) contained in

the J-POWER Group Sustainability Report 2010, the sustainability

information herein has been independently reviewed and certified

by Ernst & Young ShinNihon Sustainability Institute Co., Ltd. in

accord with the sustainability report review and registration

system of the Japanese Association of Assurance Organizations

for Sustainability Information (J-SUS). As a result of this review,

an “Independent Assurance Report” has been received.

The J-SUS mark on the back cover indicates that the

sustainability information contained in this report fulfills

the reliability criteria established by the Association for its

sustainability report review and registration system.

Acquisition of Eco-Leaf CertificationJ-POWER’s product, electrical power, is certified and registered as “wholesale

electricity” under the Eco-Leaf environmental labeling program managed by the

Japan Environmental Management Association for Industry (JEMAI). This information

is available on the association’s website.

ISO 14025 defines three types of environmental labels: I, II, and III. Eco-Leaf is a

Type III label, which means the product’s environmental load has been quantitatively

calculated for every stage of its lifecycle – manufacture, use, and disposal – using the

lifecycle assessment (LCA) approach, and this fact has been independently verified.

Information on the Eco-Leaf label can be found on the Japan Environmental

Management Association for Industry’s website.

Japan Environmental Management Association for Industryhttp://www.jemai.or.jp/english/ecoleaf/index.cfm

Document review (J-POWER head office)

Site inspection (Isogo Thermal Power Station, Yokohama)

Independent third-party certification of J-POWER Group Sustainability Report 2010

roundtable discussion with distinguished experts ... · mizue tsukushi president and ceo, the good...

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